Popular Saskatoon restaurant Leyda's Café closing its doors

A popular Riversdale restaurant says it's putting a "pause" on its operations.

Leyda's Café has announced it will close its doors on Saturday after eight years of business.

"We would like to take time to reshape and reflect on what Leyda’s will look like moving forward during these challenging times," the restaurant said in social media post sharing the news.

"Thank you for your continued support and we hope to see you soon."

The restaurant said its bread will still be available at some local grocers.

A Leyda’s representative told CTV News the pressures brought on by the COVID-19 pandemic are largely responsible for the closure.

• Get the CTV News app for Saskatoon area breaking news alerts and top stories 

Sunday marked the last day of business for another Riversdale eatery, Seoul Korean Restaurant, which closed after 11 years.

Randy Pshebylo, executive director of the Riversdale Business Improvement District, says this points to a larger problem across the city and in the province.

“When we look at some of the mandates that have been imposed and restaurants and hospitality (have) been blindsided and broadsided in a number of cases by not having spaces big enough to operate or are not financially viable to do so,” he told CTV News.

“While the efforts are there for takeout and so on, nothing beats that full capacity business model that many have financed and are operating under.

Pshebylo said significant property tax increases in the Riversdale neighbourhood are making matters even more difficult.

“When we see taxes going up from $10,000 to $33,000, from $2,500 to $15,000, and from $10,000 to $27,000, phased in or not, it doesn’t keep up with the rental rates, it doesn’t keep up with the ability to service those added costs,” he said.

“I can’t imagine the turmoil that a lot of the business owners are facing with lifetime investments, their staff and families that are involved. These are gut-wrenching decisions that are coming to the forefront.”

Pshebylo said it’s causing businesses to adapt and reimagine their business models to sustain operations.

Chad Berg, the owner of Saskatoon Clayworks in Riversdale, said he planned on expanding his business to the building next door, but instead decided to sell off that building once his property taxes went up from $4,000 to $10,000 last summer.

Berg said he is now looking to relocate to the North Industrial area.

“I decided it’s time to get out. You know, things deteriorate. I don’t want to be left here with a bunch of abandoned businesses and crime,” he said.

Berg said while COVID has had an impact on his business, the property taxes have been more detrimental.

“When you look at the long-term effects of a tax increase, and you just look at the area, problems with crime, all of these other issues, you know, that’s something that you can’t really get past and even if the city realizes they made a mistake in five years, 10 years, the harm has already been done.”

The City’s director of corporate revenue says every four years it has to reassess the value of properties based on sales data from two years prior. The most recent reevaluation was in 2021 and was based on sales data in January 2019.

“Properties that saw significant increases in 2021, you know, was because it’s a (reassessment) year, their property is worth that much more,” Mike Voth said.

“I understand that it can be a bit of a sticker shock when they open their tax bill, but that’s why we send them assessment notices five months prior to tax bills, that’s why we have an assessment office that handles appeals and helps property owners understand why the increases are there.”

Voth added that the city has a competitive tax rate for commercial properties.

“For every dollar that we would collect from a residential property, we collect $1.59 from commercial and that’s quite a bit significantly lower than any other city in western Canada, besides Winnipeg.”

Despite the property tax increases, Pshebylo said there is hope for the future of the Riversdale neighbourhood. He said there are more investors expressing interest in the area now than back in the late ‘90s and early 2000s.

“We see opportunities now where people are coming in behind and coming in with different business models and taking these spaces up.”

Seoul Korean Restaurant has already been sold, according to Pshebylo.

“I think what we’re starting to see is more of a transition between going off the off-ramp and the exit-ramp from COVID and landing into a new place where we see more business development.”